Cash being ploughed into the UK's fintech startups fell in the latest quarter – but don't panic just yet.

The value of funding declined by 12 per cent to $103m (£78.4m) in the second quarter of the year, however, the number of deals being done in one of the hottest sectors remained steady, the latest figures from KPMG and CB Insights show.

The UK also fared better compared to the overall trend – fintech funding fell by nearly half on the previous quarter across the globe, largely reflecting the wider trend in VC funding and with investors holding back on mega-round deals. These deals of more than $50m fell to a five quarter low while none occurred in Europe.

“The decline in fintech financing and deals is in line with what we’re seeing in the broader venture environment for startups, as VCs as well as crossover investors are pushing back harder on profitability and business model concerns," said CB Insights boss Anand Sanwal.

Certain sectors also continue to attract interest, with insurance and blockchain startups accounting for a number of large funding rounds.

Meanwhile, corporate interest in fintech remained firm, accounting for nearly one in every three deals, up from just under a quarter at the start of the year.

"We are seeing more partnering by traditional financial services companies with fintechs to help develop new business models, while also enabling fintechs to expand their customer base and get the support they need to become sustainable," said KPMG partner Brian Hughes.

"Although the overall VC investment in fintech is very positive, with InsurTech and Blockchain standing out as areas that continue to attract greater investment, the past quarter reflected a more cautious environment.”

That trend of corporate investment is set to continue, particularly in blockchain, artificial intelligence, predictive analytics and risk modelling.

As for Brexit, it's just one of the factors influencing investors' cautious outlook, along with US Presidential elections, ongoing concerns with valuations and "significant headwinds in the marketplace lending space", the report noted.

"Regardless of Brexit, the UK will not give up its role as Europe’s fintech leader easily, the FCA’s sandbox and the recent announcement of a fintech bridge with Singapore clearly demonstrate the UK’s commitment to fostering its strong fintech ecosystem," said KPMG's global co-head of fintech Warren Mead.

“Traditional financial institutions and banks of all sizes are realising that the opportunities associated with fintech aren’t about who has the deepest pockets – and so they’re intensifying their innovation efforts. Therefore, despite the global decline in quarter two, overall fintech funding remains on track to surpass 2015 levels.”

That would make 2016 a record year for fintech funding with $14.8bn expected to be invested in more than 800 deals this year.

Germany, which has sought to make itself a rival location to London for tech startups in the wake of Brexit, has picked up the pace in the most recent quarter, helping fintech funding across Europe grow by 22 per cent to $369m.

Funding into the country rocketed more than 70 per cent hitting $186m, up from $107m in the first quarter of the year, outpacing the UK by 80 per cent.